Published: 23-Aug- 2011 | Category: Resources
Business Interruption (BI) is a complex, "enterprise-wide" issue that often has a much different meaning to people in senior management, risk management, and operations. For example, optimized supply chains have introduced uncertainty into the severity of BI loss exposures. In many cases we have seen an "interruption" half way around the world quickly impact a client's organization, overwhelm their recovery efforts, introduce operational challenges, and cause significant financial impact to the firm. In response to this uncertainty, underwriters have been making increasingly conservative (and sometimes costly) estimates of loss regarding business interruption. Through our multi-disciplinary business interruption analysis, Marsh can help organizations across a broad range of industries and geographies to mitigate the impact of outages in their value chain and enhance their recoveries.
With a globally consistent process and standard deliverables, Marsh's Property Risk Consulting (PRC) Practice, Forensic Accounting and Claims Services (FACS) Practice, and Business Continuity Risk Management (BCRM) Practice use their unique skills to properly quantify BI and its impact on your company. Furthermore, the findings are used to help you build effective solutions to those problems and can deliver increased recovery capabilities, risk-based inventory strategies, and superior risk transfer. Services include:
- Value Stream Mapping
- Detailed Loss Scenarios
- BI Valuations and "Insurable" Risk Quantification
- Prioritized Objectives for Business Continuity Plans
Value Stream Mapping
Using tools from Lean Manufacturing, we can establish a consistent and repeatable methodology to analyze the operational risks associated with BI. The analysis includes the benefits from back-up inventory, alternate production capacity, and business continuity programs.
Detailed Loss Scenarios
To support your decisions on placement issues such as deductibles and limits, you need valid loss scenarios and estimated impacts (e.g. MFLs). PRC can quantify the loss impact in our scenarios along the entire chain of contingent, direct, and interdependent exposures.
BI Valuations and "Insurable" Risk Quantification
Our FACS practice can use your financial statements to determine whether your BI program's limits and coverage are aligned with the financial assets you are trying to protect. That process can help streamline your retention decisions as well as set up your best practices for presenting BI claims to underwriters.
Prioritized Objectives for Business Continuity Plans
Working together, our PRC, FACS, and BCRM experts can provide you with an improved understanding of your operations and commensurate estimates of possible losses, so that you can better allocate your business continuity resources to protect your firm's high value operations.